The £9 Million Question: Believe Housing Ltd’s Tax-Free Surplus Sparks Outrage..

Believe Housing Ltd, with its head offices based in Seaham County Durham

Calls for a large Private Housing Corporation to be stripped of its so called 'charitable status', as claims of 'obscene' profits lead to nothing being paid back in Corporation Taxes.....

30th March 2025

In a time when public services are stretched thin and ordinary taxpayers are feeling the pinch with cuts to winter fuel payments & welfare cuts, Believe Housing Ltd—a County Durham-based housing association—has reported a staggering £9 million surplus for its latest financial year after raising its rents to some of their highest levels in years.

What’s raising eyebrows, however, isn’t just the size of the surplus they've generated, but the fact that, thanks to its “charitable” status, not a single penny of it has been handed over to HMRC in UK corporation tax.

This revelation has ignited a firestorm of debate about the fairness of tax laws, the eye-watering salaries being paid to its senior executives, and whether organisations like Believe Housing really deserve the generous tax breaks they enjoy under the guise of charity. Increasingly, voices are calling for this status to be stripped away—and it’s not hard to see why.

A Charitable Loophole or a Corporate Con?

Let’s start with the basics. Believe Housing Ltd, like many so called 'housing associations' in the UK, operates as a registered charity. This unique status grants it exemption from corporation tax on profits, provided those profits are then reinvested back into its charitable objectives—namely, providing affordable housing. On paper, this sounds noble: a safety net ensuring that funds stay focused on helping vulnerable people rather than lining the trousers of its heavily bloated senior management. But when an organisation posts a £9 million surplus—while simultaneously paying senior executives salaries that dwarf what most of its tenants could dream of earning—the “charitable” label starts to feel more like a convenient tax dodge than a genuine commitment to public good.

The UK tax system is built on the premise that charities exist to serve a social need, not to amass wealth or reward their top brass. Yet Believe Housing’s financials tell a very different story. A surplus of this magnitude suggests either an astonishing level of efficiency (unlikely, given the housing sector’s chronic underfunding) or a strategic stockpiling of cash that’s not being ploughed back into the communities it claims to serve. If the latter is true, then the tax exemption begins to look less like a reward for altruism and more like an unfair advantage over private companies who must fork over 19% of their profits to the Treasury.

Senior Salaries: Charity Begins at Home?

Believe Housing Ltd CEO Alan Smith, who currently takes home £186,856 a year

Peel back the curtain, and the picture gets much murkier. Senior executives at Believe Housing are said to be pulling in salaries that would make even a City banker blush. Whilst exact figures for the latest year aren’t widely publicised, housing associations of this size generally have a track record of handing out six-figure pay packets to their top dogs—sometimes exceeding £200,000 annually. For context, that’s more than ten times the median income in County Durham, where many of Believe Housing’s tenants live. These tenants, often low-income families or individuals reliant on social housing, are left to wonder how an organisation sitting on a £9 million pounds surplus can justify such lavish rewards for its leadership whilst rents creep up and repairs lag.

This isn’t an isolated issue. Across the housing sector, the disconnect between executive pay and the lived reality of tenants has fuelled accusations of mission drift. If Believe Housing’s purpose is truly charitable—to alleviate poverty and provide affordable homes—why does so much of its surplus seem to end up in the pockets of those who need it least?

The optics are terrible: a “charity” that pays its bosses handsomely whilst tenants struggle to make ends meet hardly screams selflessness.

The Tax Law Tilt: David vs. Goliath

The Believe Housing saga shines a spotlight on a broader issue: the UK’s tax laws are increasingly seen as skewed toward large organisations with government links that can exploit charitable status, leaving smaller players—both businesses and genuine grassroots charities—out in the cold. A private landlord or small construction firm generating a £9 million profit would be on the hook for £1.71 million in corporation tax. That’s money that could fund schools, hospitals, or, ironically, more social housing. Meanwhile, Believe Housing keeps every penny, shielded by a status that’s starting to feel outdated and ripe for abuse.

Critics argue this creates an uneven playing field. Large private housing corporations like Believe Housing can undercut competitors, hoard surpluses, and grow ever more dominant, all whilst dodging the tax burden borne by others. The law, they say, was never meant to prop up quasi-corporate giants—it was designed to support small, community-driven efforts. When a single organisation can wield such financial clout under the charitable banner, it’s fair to ask whether the system is broken.

Calls to End the Charade

Unsurprisingly, the £9 million surplus has sparked calls to rethink Believe Housing’s charitable status. Campaigners, tenants, and even some policymakers are now questioning whether an organisation this flush with cash—and this generous to its executives—should enjoy the same tax perks as a local food bank or a volunteer-run shelter. Stripping its charitable status wouldn’t just force Believe Housing to finally pay corporation tax; but it would send a signal that the label “charity” comes with real responsibilities, & not just rewards.

Defenders of the status quo might argue that surpluses are necessary to fund future housing projects or weather economic storms. But with £9 million in the bank and no clear timeline for spending it, that excuse feels flimsy. If Believe Housing isn’t actively using its wealth to address the housing crisis—say, by building more homes or slashing rents—then what’s the point of its tax break? The public deserves transparency, not platitudes.

Believe Housing Ltd’s £9 million tax-free surplus isn’t just a financial footnote—it’s a glaring symptom of a system that’s completely broken. The charitable status that once made sense for small, altruistic outfits now looks like a golden ticket for large organisations to sidestep accountability whilst raking in profits and paying out big. The senior salaries only twist the knife, highlighting a disconnect between the haves at the top and the have-nots they’re meant to serve.

As calls therefore grow to end this shady arrangement, the ball is in the court of lawmakers and regulators. Will they let housing associations like Believe Housing keep gaming the system, or will they demand a fairer deal—for taxpayers, for tenants ?

One thing’s clear: a £9 million surplus shouldn’t come with a free pass.

It’s time to stop believing the hype and start asking hard questions.